ACA assurance
What's in an audit strategy - correct answer ✔✔- broad scope
- understand the entity
- understand the accounting systems and internal control systems
- identifying risk and setting materiality
- nature, timing and extent of resources necessary
- mgmt, direction and supervision of audit team
Audit plan - correct answer ✔✔- more detailed
- nature, timing and extent of the specific audit PROCEDURES required for material issues
- ensure appropriate attention is devoted to important areas of the audit
- identify potential problems and resolve
- ensure work is properly organised and managed (incl assign work to team members & facilitate
supervision)
Revenue system - correct answer ✔✔1. ordering
2. despatch and invoicing
3. recording
4. cash collection
Purchase system - correct answer ✔✔1. ordering
2. goods received and invoiced
3. payment
Payroll system - correct answer ✔✔- calculating wages and salaries
- recording
- payment
, What should be considered for sufficient evidence - correct answer ✔✔sufficient quantity to support the
audit
- risk assessment
- are the internal controls weak or strong?
- materiality of the item
- experience from past audits (particular issues)
- results of audit procedures
- source and reliability of info (quality)
What should be considered for appropriate evidence - correct answer ✔✔Relevant
- evidence gathered must relate to FS assertions
Reliable
- external better than internal
- internal more reliable when control are effective
- auditor generated better than client generated
- documented better than oral
- og docs better than copies
What should you do if there's overstatement - correct answer ✔✔Issue of existence so go from FS -->
source
What should you do if there's understatement - correct answer ✔✔Issue of completeness so go from
source --> FS
Contents of a general written representation - correct answer ✔✔Mgmt provide confirmation they have:
- fulfilled their responsibilities for the prep of FS in accordance w frameworks
- provided auditor w all relevant info and access to all books
What's in an audit strategy - correct answer ✔✔- broad scope
- understand the entity
- understand the accounting systems and internal control systems
- identifying risk and setting materiality
- nature, timing and extent of resources necessary
- mgmt, direction and supervision of audit team
Audit plan - correct answer ✔✔- more detailed
- nature, timing and extent of the specific audit PROCEDURES required for material issues
- ensure appropriate attention is devoted to important areas of the audit
- identify potential problems and resolve
- ensure work is properly organised and managed (incl assign work to team members & facilitate
supervision)
Revenue system - correct answer ✔✔1. ordering
2. despatch and invoicing
3. recording
4. cash collection
Purchase system - correct answer ✔✔1. ordering
2. goods received and invoiced
3. payment
Payroll system - correct answer ✔✔- calculating wages and salaries
- recording
- payment
, What should be considered for sufficient evidence - correct answer ✔✔sufficient quantity to support the
audit
- risk assessment
- are the internal controls weak or strong?
- materiality of the item
- experience from past audits (particular issues)
- results of audit procedures
- source and reliability of info (quality)
What should be considered for appropriate evidence - correct answer ✔✔Relevant
- evidence gathered must relate to FS assertions
Reliable
- external better than internal
- internal more reliable when control are effective
- auditor generated better than client generated
- documented better than oral
- og docs better than copies
What should you do if there's overstatement - correct answer ✔✔Issue of existence so go from FS -->
source
What should you do if there's understatement - correct answer ✔✔Issue of completeness so go from
source --> FS
Contents of a general written representation - correct answer ✔✔Mgmt provide confirmation they have:
- fulfilled their responsibilities for the prep of FS in accordance w frameworks
- provided auditor w all relevant info and access to all books
